RIFT VALLEY UNIVERSITY

ADAMA MAIN CAMPUS

FACULTY OF BUSINESS AND SOCIAL SCIENCE
DEPARTMENT OF: - BUMA

PROGRAM: - 4THYEAR, REGULAR

SUBJECT: - STRATEGIC MANAGEMENT

GROUP: - 5

STUDENT NAME ID
KULENI GEMEDA...................................................................................................0528/19

SUBMITED TO: - M.R SEID A (MBA)

SUMITED DATE: - 08/05/2023 E.C

1. What do we mean by strategy? How is a business model different from a strategy?
Strategy refers to a set of actions or decisions that a business entity takes in order to
achieve its goals and objectives.
 A strategy outlines how the business plans to accomplish its mission and vision.
 It takes into account the organization's strengths, weaknesses, opportunities, and
threats, as well as any external factors that may impact the business.
 A good strategy should be well-defined, flexible, and proactive in its approach.
 A strategy is concerned with the overall direction of the business, its competitive
position in the market, and how it will achieve its goals.
 Strategy is a long-term plan
 A good strategy should provide a roadmap for the future
 strategy is a high-level plan for how a business will achieve its goals
A business model, on the other hand, refers to the way that a company generates revenue
and profits.
 It is essentially the plan for how a company will make money.
 A business model outlines the value proposition that the company intends to offer
to the market, the target customers, the channels through which it will sell
products or services, and the revenue streams that it will utilize.
 The business model is more tactical in nature, outlining the operational and
financial aspects of how a company will make money.
 A business model, on the other hand, is focused on the day-to-day operations of
the business, including how it will generate revenue, manage costs, and deliver
products or services to customers.
 Business model may be revised and adjusted as the business evolves and grows.
 Business model should provide concrete steps for achieving the goals set forth in
the strategy.
 A business model is a more operational plan for how it will generate revenue and
profits.
2. What does mission statement state about?
A mission statement is a concise statement that summarizes the core purpose, values,
and goals of an organization or business.
The purpose of a mission statement is to provide direction and guidance for the
organization's decision-making processes and to communicate its identity and values to
its stakeholders, including employees, customers, and investors.
A well-crafted mission statement should answer questions like:
 What does the organization do?
 Who do they serve?
 What sets them apart from their competition?
 What values guide their actions?
 By having a clear and concise mission statement, an organization can effectively
communicate its objectives to all relevant parties and work efficiently towards achieving
its goals.
3. Differentiate mission and vision statements?
Mission and vision statements are two important elements of any organization's strategic
planning.
List of the differences between mission and vision statements:
a. Meaning:
 A mission statement describes the purpose and direction of an organization,
 Vision statement describes its aspirations and goals.
b. Focus:
 A mission statement focuses on the present, describing what the organization does
and for whom,
 Vision statement focuses on the future, describing what the organization wants to
achieve.
c. Time frame:
 A mission statement is often more concrete and immediate, typically detailing
what the organization is currently doing or plans to do in the near future.
 A vision statement is more abstract and future-oriented, typically describing where
the organization wants to be in five, ten, or even twenty years.
d. Function:
 A mission statement communicates the organization's core values and beliefs,
 Vision statement provides a roadmap for the future and what the organization
hopes to achieve.
e. Scope:
 A mission statement is specific to the organization, outlining its unique
characteristics and what it offers to its stakeholders.
 A vision statement is often more broad, encompassing the larger societal or global
impact the organization seeks to make.
f. Implementability:
 A mission statement is more practical and achievable, outlining the specific
activities and goals that the organization currently pursues.
 A vision statement is more aspirational, often requiring innovation and
transformational change.

Overall, it is important for an organization to have both a clear mission statement and a
comprehensive vision statement.
While the mission statement sets the foundation for the organization's present and
immediate future, the vision statement inspires and guides the organization towards
achieving its long-term goals and aspirations.
4. What is the importance of formulating vision and mission statement?
Formulating a vision and mission statement is important for any organization as it helps
to outline the purpose, goals, and values of the organization.
Why it is important:

a. Provides direction: The vision and mission statement provide direction to the
employees, partners, and stakeholders of an organization.
It outlines the purpose and goal of the organization, providing guidance and clarity on
what the organization aims to achieve.
b. Defines values: The vision and mission statement define the values of an
organization.
It outlines what an organization stands for, what it believes in, and what it wants to
promote.
This helps the employees and partners understand the culture and environment they
are working in.
c. Positive brand image: A strong vision and mission statement can enhance the brand
image of an organization.
By having a clear purpose and set of values, an organization can attract like-minded
customers and partners who share its vision.
d. Increases motivation: A strong vision and mission statement can increase motivation
and commitment among employees.
When employees understand the purpose and goal of the organization, they are more
likely to work towards achieving them.
e. Strategic decision-making: The vision and mission statement helps in making
strategic decisions.
When an organization has a clear purpose, goals, and values, it can make informed
decisions that align with its mission.
Formulating a vision and mission statement is important as it helps to provide direction,
define values, enhance brand image, increase motivation, and make strategic decisions.

5. Identify the components which are mentioned in this mission statement.

Dell’s mission statement”……….. Is to be the most successful computer company in the
world at delivering the best customer experience in markets we serve. In doing so, so dell
will meet customer expectations of highest quality; leading technology; competitive
pricing; individual and company accountability; best-in-class service and support;
flexible customization capability; superior corporate citizenship; financial stability”.
The components mentioned in Dell's mission statement are:
i. Goal: To be the most successful computer company in the world.
ii. Focus: Delivering the best customer experience in markets we serve.
iii. Customer expectations: Highest quality; leading technology; competitive
pricing; individual and company accountability; best-in-class service and
 support; flexible customization capability; superior corporate citizenship;
financial stability.
6. Assume that XYZ power Ltd. Set up a factory for manufacturing solar lanterns in a
remote village as there was no reliable supply of electricity in rural areas. The revenue
earned by the company was sufficient to cover the costs and the risks the demand of
lanterns was increasing day to day, so the company decided to increase production to
generate higher sales. For this they decided to employ people from the nearby village as
very few job opportunities were available in that area. The company also decided to open
schools and crèches for the children of its employees.
i. Identify and explain the objectives of management discussed above.
ii. State and two values which the company wanted to communicate to the society.

Objectives of Management:

a. Increase Production: The first objective of management in this scenario is to

increase the production of solar lanterns.

As the demand for lanterns is rising, the company needs to increase its production in
order to meet the growing demand.

b. Generate Higher Sales: The second objective of management is to generate higher

sales.

With the increase in production, the company hopes to sell more lanterns and thereby
increase its revenue.

c. Employment Generation: By employing people from the nearby village, the

company is addressing the issue of unemployment in the area.

This objective aligns with the company’s overall contribution to social welfare.

d. Social Welfare: The company has decided to open schools and crèches for the
children of its employees, which showcases its commitment to social welfare.

This objective goes beyond commercial interests and displays the company’s broader
concern for the community where it is situated.

Values:

The company is communicating two important values to the society through its actions:

a) Corporate Social Responsibility (CSR): By setting up a factory in a remote village

and generating employment, the company is demonstrating its commitment to CSR.
The decision to open schools and crèches for the children of its employees further
amplifies this value proposition.

b) Inclusivity: The company's decision to employ people from the nearby village
showcases its commitment to inclusivity.

By bringing employment opportunities to an area with few job opportunities, the

company is making a tangible contribution to the local community.